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Sorry, Chriskies, my previous citation was from Chriskies (not prevotes).

scotman, I agreed all what you said on the more sophisticated impact of royalty on divs.

Just the impact of the total share number (increase) to SP and divs is more explicit and easier to understand and notice.

prevosts: "ICL a stick on for the MTS additional in exchange for strategic partner status...hopefully not a choking royalty. Rather them equity."

For strategic partners, as a PI, I would prefer them to take royalty rather than equity. Although both would dilute the share of existing share holders, the addition of a large amount of new shares would have a much more explicit impact on the share price and dividend per share.

For example, in case SM reaches a market cap £3.85b (i.e., matching to the total amount of funds raised by SM after stage 2), if the total share count is 7b, the share price would be 55p; while if the total share count is 11b, the share price would 35p. The impact to divs would be similar. If SM has £1b to distribute as dividend, 1/7 = 14p; while 1/11 = 9p;

Myo: on Boulby "In my opinion the re is a ar better argument to have two mines producing and educating the world to better fertilizer practice than one. ..."

Yes, it would be better to have more polyhalite mines educating/convincing the world on the potential of this new fertilizer than one (of cause if these other mines are not large enough to compete with SM).

Thanks, Myo for the well-made Boulby vedio. It physically confirms the existence of minable polyhalite there. It also shows that the product has a market around the world and the product has helped farmers improving their corp/plant yields and quality.

Israel has an excellent reputation in many business/technology fields in the world. Although they are lack of lands, their agricultural technology/methods are also excellent. Their research and marketing exploration on polyhalite has made a great contribution to this new fertilizer. The raw polyhalite material from them has made it possible for SM to produce and testing poly4 (and provide the customers with poly4 samples) many many years before SM's own first poly4.

Due to the scale and the aging facility of the Boulby mine, it is unlikely that Boulby and SM can co exist in the same area. However, some kind of cooperation/solution may emerge to be beneficial for both of them.

For example, ICL may invest into SM as one of the strategic partners (for the additional $400m-$600m funding), possibly with the Boulby mine as part of their investment (in addition to the new cash). In this way, they can be the market leader (as required by their strategy) and also help to market/distribute the polyhalite products in various forms of MOP+Polyhalite blends/compounds. SM can get/share Boulby's experienced workers and customers and research on the product, also test new technology/equipment and train their workers well before the new mine is operational.

Myo/Scotman/Chilting, yes, as MOP is dominant in fertilizer market (mainly due to its high potassium content and high production volume), Poly4's mainly market will be in the current MOP market, through large blenders and compounders as customers/partners/distributors. MOP+Poly4 would combine the MOP's high potassium content with the Poly4's low chloride multi-nutrient advantages, resulting a more cost-effective fertilizer product.

The Dan McCrum, the "best loved friend" on this board, had cited Fertecon 2015 report which says that "in order to sell 6.5m tonnes [Sirius] may need to sell to around 16 per cent of the world’s compounders and blenders, all of whom will also need to buy other forms of K2O" (i.e., MOP). SM has already had many large customer with such capabilities: ADM, Cibra, Wilmar, ITL Trading, and Eiliseng. ICL should also be one in the near future. Other big desirable ones include the largest MOP producers/distributors: Nutrien, Uralkali, Belaruskali, BHP. SM has already had enough customers to kick start its 10mtpa production. Later to reach 20mtpa, such big ones would become more important, e.g., Nutrien (a merge of PotashCorp and Agrium) alone could consume more than 10mtpa for the mix.

PheasantBoy, this is the deal mentioned in my post: Ochoa in New Mexico signed a 1.5mtip TorP with Nitron.
This deal takes 75% of the Ochoa potential polyhalite product.
Similar as SM, Ochoa originally wanted to produce and sell SOP from polyhalite, then later decided to sell polyhalite directly as a fertilizer (given many supporting evidence has been emerged from the trials).

The crucial fate of the SM stage 2 fundraising relies on the market potential of its product (poly4).
Poly4 (polyhalite) is a disruptive product. It has a significant market potential in all types of fertilizer markets (i.e., it will disrupt the whole fertilizer market).

Bio market: Poly4 is a natural product, and certified as a biofertilizer. Although small at the moment, this is an emerging rapid growing market. For a healthy living style, more and more people are happy to pay more for bioproducts;

SOP and SOPM market: The share of this market is low mainly due to the high price, rather than the need is low. The need for low chloride potash is actually very high. On this regard, poly4 is similar to SOP and SOPM, but produced at a much lower cost than them.

MOP market: This is the largest potash fertilizer market. Poly4 can be blended with MOP products to lower their cost and their chloride level, so as to create cost-effective multi-nutrient fertilizer products.

Other blend markets: blends of NPK (combined or separated N, P, K) and poly4 in different ratios to be applied at different stages of the plant/corp life cycles for a balanced multi-nutrient fertilization approach.

The polyhalite fertilizer market potential has also been proved by the excellent results of many years of field trials (on many corps and plants, with increased yields, and improved product and soil quality) and a large number of high volume sales agreements.

ICL has produced and sold polyhalite in the worldwide market (e.g., with the largest Brazil fertilizer distributor Yara as its customer and with customers in China).

Ochoa has signed 1.5mtpa polyhalite sale agreement with a world leading fertilizer distributor Nitron.

Sirius has signed TorP sale agreements with the Fortune Global 500 company ADM (1.55mtpa), tone of the large Brazil fertilizer distributor Cibra (2mtpa), large customers in China (2.5mtpa), and also signed large marketing agreement in Europe (Keytrade, 1.75mtpa).

Such great marketing results and vast market potential are the keys to ensure successful fundraising in the upcoming SM stage 2 deal, as the lenders can be assured that their money can be returned, together with an excellent profit.

Andrew4444, I remember, GK mentioned before, that the departments offered the CB and then shorted were not the same departments in JPM. They are not allowed to exchange inside information for their trading. They (the CB participants) do not have to buy back the shares at a very high price to return the shares they borrowed and sold as other ordinary short sellers. They can do this later by simply converting their convertible bonds into the shares for them to return the borrowed shares (in this way they can still enjoy the money earned at a high interest rate for a long time).

M and Fred, I agree, particularly if it is JPM, then the main change would be the admin leadership and the funding structure. Many of the banks that wanted to participate may still be able to contribute to the package and IPA may still cover a part of the funding. In this way, some of the difficulties met in the lending group, possibility caused by some difficult parties in the group, could be avoided. They also do not need to repeat the DD that they did before. This might be the reason why the confirmation of the commitments may come much sooner than before.

A very interesting article that brought lots of useful information on the (up to present) life cycle of the project together.
It is a very good read, particularly, for new and potential PIs to have an overview of the project. The info in the article includes:

1. What you need to know about Sirius Minerals: a snapshot
2. A year-by-year timeline of Sirius Minerals
3. Sirius Minerals first stage financing
4. 2019: Has Sirius found its saviour?
5. Sirius share price: a technical analysis
6. What is polyhalite?
7. Woodsmith mine: what you need to know
8. Conclusion: where next for Sirius Minerals?

casa: "WWG. There is a negligible chance that the $400-600 mill " equity component"(if there is one) will be priced at a premium to the current SP. It is far more likely to be at a discount (possibly a significant discount )and the news of such a transaction would most likely drive the SP down from its current level."

Whether the potential placement/open offer price is higher or lower than the current share price may depend on when the placement price is decided: e.g., before, at the same time, or later than the confirmation of the $3b debt. I gather the placement price could be lower than the current level only in case the placement is made before the confirmation of the $3b senior debt (or, the convertible option is on the large part, say on $2b of the $3b debt).

In whichever case, even the overall deal is not too bad (i.e., when all the needed money is secured, but with a quite significant level of dilution) which would ensure the mine to be built, there will still quite amount of inexperienced PIs who may think the deal is bad, and therefore, selling their shares in panic (even at a big loss).

All of us PIs (many of whom may have held the share for quite a long time) should have a look at the overall deal carefully when it is announced, and try to avoid to give up your shares in panic at the last minutes/hours when the stage 2 raising is done (and the mine will be built for sure) !!!

It is pity that there are always many people (termed as weak hands) who will sell in panic at a sudden sharp drop just before a sharp bounce back. Try to avoid to become one of them !!!

In a fair-level dilution scenario in the upcoming alternative deal (as speculated in my previous post, among the best, good, and fair levels), the worst case for existing shareholders could be:

- Among the additional $400m-600m: all $600m is to raised as an equity component, say at 21p, this will add 2.2b new shares (due to the fact that the raising will be done after the confirmation of the £3b debt deal, the placement price might be higher than the current share price as the new share price after the confirmation should be much higher than the current price);

- Among the $3b senior debt: $1b will be convertible, say at 25p, this will add 3.33b new shares (as the convertible may happen at a time months or years after now, the converting price of the senior convertible should be set at a level higher than 25p);

Given the current 4.8b shares, we get new sum: 10.33b, plus stage 1 convertible, the total number of shares would reach 11b.

After stage 2, the total raised fund will be around $5.03b or £3.84b; this gives an average raised money per share: 35p.

If by 2024, the MC reaches $7b, the share price could be 50p; and if the MC reaches $9.1b (£7b) the share price could be 64p. The estimated MC could be higher than these two numbers, based on the 2024 NPV provided by SM at 50% discount.

Even in the worst scenario, an investment at the current share price is still quite profitable; and the investment of most existing shareholders (even at an average higher price) will also be profitable. It is very likely that SM can get a deal better than the above (say with a total number of shares in the range of 7b to 10b), or even the sentiment effect alone may push the share price much higher than the ones mentioned above at the times of the first poly, the first shipment, or a completed mine of 10mtpa capability.

Fred, yes, the current price is very attractive as it is lower than the cost per share value (i.e., already raised money per share = all the money raised so far divided by the current total number of shares, roughly at 22p at this moment). If I would have a big sum of money that only takes 2% of the whole as casa, I would have put all this (that was out of this before) in at this moment (to have much more shares than before), as if the stage 2 is successful in a few weeks, the average raised fund per share would be much higher than the current share price (see some calculation I did before).

Due to the needed funding (i.e., stage 2) has not been secured yet, fundamentally, the holding of this share is still a bet. However, Given our understanding on this company, many of us on this board would consider this as a well-informed bet whose odds of winning is quite high. Such kind of opportunity, as many mentioned here, is rare.

The share price is very likely at the bottom of this round of (multi-month) downtrend.
A new uptrend seems to have already started (technically on the chart).
I have increased my holding very significantly (in comparison to what I had when I first got in), and also prepared to take all that I can get in the potential open offer. Given the dilution is, almost for sure, to happen in the stage 2 deal, all in at this time may lose the potential opportunity to take part in a discounted open offer.

Myo, thanks for your explanation. Given the winder house has been built and its matching winder arrived, it makes sense to use the powerful permanent winder for both construction and production.

Yes, the construction progress is very impressive and in full speed as planned.
Given the deal/arrangement of the whole stage 2 can be expected in just a few weeks, it becomes more and more likely that the construction will continue in its full speed with the first poly in 2021.

Myo, excellent post on the balanced multiple nutrient fertilization approach enable by poly4 !
Poly4 is not only cost effective, but also premier among major competing products.

Given the increase of the fertilizer demand and price as reported in the Forbes magazine article, the future of poly4 (and the blends with it) becomes even brighter :)

The massive winding wheels:
https://i2-prod.gazettelive.co.uk/incoming/article16010361.ece/ALTERNATES/s615b/0_The-massive-winding-gear-that-will-transport-miners-up-and-down-the-Sirius-Minerals-mine-has-arrived.jpg

https://www.gazettelive.co.uk/news/teesside-news/giant-hoists-take-sirius-minerals-16010164

Two giant impressive pieces of equipment !

Will the constructor use the SM Giant hoists (winding gear) to control the giant Roadheader (SBR) as they arrived at similar time?

My previous impression is that the Herrenknecht SBR comes with its own winding gear. The SM giant winder gear will be fitted later after the shaft construction using the SBR is completed. It this correct?

Best:
- the $3b in the alternative structure is all senior debt (with different interest rates in more than one tranches, and without an equity component in it (i.e., no convertible bonds in the structure)).
- the additional $400m-$600m funding consists of a mixture of a loyalty of one or more strategy partner(s), convertible bonds (including the Major Global Financial Institution (new backer) as a lender), placement and open offer.

Good:
- the $3b in the alternative structure is all senior debt (with different interest rates in more than one tranches, and without an equity component in it (i.e., no convertible bonds in the structure).
- a larger additional financial requirement (greater than $600m, e.g., $1b) consists of a mixture of a loyalty of one or more strategy partner(s), convertible bonds (including the Major Global Financial Institution (new backer) as a lender), placement and open offer.

Fair (not very good, but get the needed money anyway):
- the $3b in the alternative structure is all senior debt (with different interest rates in more than one tranches, and with a limited amount of equity component in it (e.g., a less-than $1b convertible bonds in the first tranche, which is senior than the convertible bonds in stage 1 and that in the additional money part of stage 2).
- an additional financial requirement ($400m-$600m) consists of a mixture of a loyalty of one or more strategy partner(s), convertible bonds, placement and open offer.

Poor :
Any arrangement that is worse than the above.

Given the comments made by JPM (i.e., any new backer of this size would want an equity component in the deal, and the previous bank lending group (LG) deal (with the HY part convertible) was not likely to be made in a timely fashion, SM would be very likely take the Alternative Proposal at the good or fair levels. SM may not resume the LG discussions, unless the alternative proposal (getting worse after DD) is at the poor level or the LG provides a modified/improved offer.

IMO of course, or any other outcomes than the above?

littlened, I agree with most of what you said.

Stock prices move upwards or downwards mainly by the (factual) news emerged after things have happened (e.g., on marketing, fundraising, construction in the case of SM).

However, stock prices also move by the rumor (hence the saying "buy on the rumor sell on the news").
Both facts and rumor (information true or not) affect people's sentiment.
"The Psychology Of Chart Patterns" also affect people's sentiment and behavior.
I.e., when more and more people understand and believe in some chart patterns or TA indicators, their sentiment and their buying or selling behavior will also be affected, then the movement of share price affected.

One thing seems to be strange, but happened again and again, is that some chart patterns often (co-occur with rumors or not) precede or "predict" some important factual news (on the results of important development or decision making processes).

Therefore, the possibly of such sentiment-drive price movement identified by TA should also be taken into consideration.

Chesh, to see it, you need to click "View hidden content", as I only uses the site to upload the image and add no text to explain it, people there commented that "the post makes no sense" (and therefore flagged it and made it temporarily hidden).

This is the first time I use imger.com, if the image I uploaded there is not visible.
One can see the long term trend reversal sign mentioned in my post, by choosing 5Y and (Lower) Stochastic
on the free charts at
https://markets.ft.com/data/equities/tearsheet/charts?s=SXX:LSE

Chesh: "Are you takling longer term............. hmm! I'm a Div :)"

For most share of great companies, the very long term trend of course is up. For this share, I'm a Div too :)

However, this share had demonstrated strong seasonality in past ten years, i.e., in the general uptrend over the ten years, up and down trend have changed regularly (roughly every half a year).

When talking about the long term (or better refer it as medium term) trend for this share, I mean a trend lasting for multiple months.